Payphones gouging users on their way to oblivion

The trouble started when Tom King’s cellphone died on his way to a job interview last year.

He saw a public phone at the Bainbridge Island ferry dock and was relieved, he said, when a sticker reassured him that he could make a four-minute call for $1.

King made four one-minute calls using his credit card, for which he expected to pay $4. But a few days later, he discovered that he’d been charged $14.98 for each connection, for a total of nearly $60. “I was shocked,” he said.

Stories like King’s are a cautionary tale for travelers. Fewer than 500,000 public telephones remain in the United States, operated by a network of independent telecommunications companies that set their own rates, which can often be startlingly high.

Verizon, the last major telecommunications provider of payphone services in the United States, left the industry in 2011 when it agreed to sell almost all of its remaining 50,000 phones.

California Senate Bill 50, which was introduced last month, would amend a 1993 rule requiring payphone operators to disclose the cost of a call so that it would also include any calls made with a credit or debit card.

Telecommunications companies are taking advantage of a “loophole” in the rules, said Sen. Ted Lieu of California. “At the time the law was passed, using a credit or debit card for payphone calls was uncommon, and thus not addressed by the law.”

Consumer advocate John Mattes, an attorney who has unsuccessfully sued several companies offering these pricey calls from public phones, says that he hopes the legislation will have a ripple effect, encouraging other states to adopt similar disclosure requirements and eventually compelling the federal government to close the loophole once and for all. “It would be a long-overdue victory for consumers,” he said.

No one knows exactly how many travelers have fallen for these phones, but there have been plenty of reports of overpriced phone calls. Last year, several media outlets reported that U.S. soldiers in transit through Germany were being billed up to $40 for a one-minute phone call home via a company that claimed to be based in Switzerland.

King tracked his charges to a company called WiMac Tel, a company based in Palo Alto, Calif., that offers payphone services to “inmate facilities, payphone operators, hotels, hospitals, universities/colleges, local exchange companies and consumers nationwide in the USA and Canada,” according to its website.

“WiMac Tel promises customers that their payphone systems can make payphones profitable again,” King said. “Well, duh! At nearly $15 a minute, I imagine so.”

James MacKenzie, WiMac Tel’s chief executive, says that the $1 rate on the payphone King saw was for coin calls, not credit cards. “Unfortunately, there is insufficient space on the payphone to provide all the various rates associated with operator service calls,” he told me.

Sen. Lieu estimates that his bill would affect roughly 30,000 public phones in the state of California, located in places where constituents can least afford the high charges, including prisons and hospitals.

How do you avoid these fees? Keep an extra battery handy when you travel, so that if your cellphone goes dead, you won’t have to resort to using a payphone. Or you could buy a prepaid phone card.

Reach for your plastic only as a last resort. Try using coins or bills to pay for the call, if possible. We’re still a long way from closing the disclosure loophole for credit card calls, and until then, it seems, your payphone calls could cost a lot more than you expect.

Christopher Elliott is the ombudsman for National Geographic Traveler magazine and the author of “Scammed.” Read more travel tips on his blog, www.elliott.org or email him at celliott@ngs.org.